CCHF Draws MN Governor's Attention to Troubling Section of HHS Omnibus Bill



For Immediate Release
May 5, 2017



CCHF Draws MN Governor's Attention to Troubling Section of HHS Omnibus Bill

 Recently Added 'Delete-All' Amendment Strips Many Protective Provisions from Original Senate Version of Bill 

ST. PAUL, Minn.Citizens’ Council for Health Freedom (CCHF, is alerting Minnesota Gov. Mark Dayton to a troubling policy section of the Delete-All Amendment of the HHS Omnibus bill, which strips many of the protective provisions in the original Senate version of the bill.

CCHF is bringing the issue to the attention of the governor, as well as Rep. Kurt Daudt, Speaker of the House, and Sen. Paul Gazelka, Senate Majority Leader. The bill, SF 800, is on hold pending negotiations between leadership and the governor.

The ‘Premium Relief’ bill, which became law on Jan. 26, 2017, repealed the longstanding ban on for-profit HMOs in Minnesota. Now, Article 5, Section 10 of the HHS Omnibus bill—Nonprofit Health Care Entity Conversions—considers requirements for non-profit, tax-exempt health plans that choose to convert to for-profit corporations.

“The tax-exempt status of Minnesota health plans provided a competitive advantage for more than two decades against tax-paying for-profit insurers,” wrote Twila Brase, president and co-founder of CCHF. “A few non-profit health plans now control the entire Minnesota market. Former for-profit indemnity insurers, for example, have left the state or dissolved.”

The language in the original bill, authored by HHS Chair Sen. Michelle Benson, included significant oversight and protections against private inurement and self-interested choices by tax-exempt health plans of “conversion benefit entities” for transfer of assets during the conversion process.

But the 583-page amendment, which was introduced on May 1 as a substitute for SF 800 and was adopted by the conference committee, deleted the following protections:

  • The requirement for approval of the conversion by the Attorney General—or anyone
  • The penalties and remedies section for a “conversion transaction entered into in violation of this section”
  • The requirement that: “The conversion benefit entity must be completely independent of any influence or control by the nonprofit health care entity and related organizations…”
  • Consultation between the AG and the commissioner of commerce to approve or disapprove conversion
  • The requirement that the nonprofit health plan “transfer the entirety of the full and fair value of its public benefit assets to one or more conversion benefit entities as part of the transaction”
  • Annual report requirement for the conversion benefit entity to give a “detailed description of its charitable activities related to the use of the public benefit assets received under a transaction…” (e.g. merger, conversion, consolidation)

Brase also noted in the letter to the governor that a certain private inurement prohibition was changed from “any type of compensation” to “any type of onetime compensation.” In addition, the definition of “public benefit assets” was changed to a definition that could limit the transfer of assets, and nothing in the bill prohibits the health plans from setting up directly or indirectly a “new nonprofit corporation” for the transfer of assets gained under their tax-exempt status.

“CCHF is urging the governor and other leaders to reconsider the language in this bill and ask for the reinstatement of the more protective language,” Brase said. “We are concerned that the language in the bill will allow health plans to funnel millions of dollars to non-profit groups that align with the health plan’s policy initiatives or other agendas.” 

To read the full text of the letter on the CCHF website, click here.

CCHF’s initiative, The Wedge of Health Freedom ( using third-party-free direct payment to transform the entire health care system back to freedom and restore simplicity, affordability and confidentiality. Nearly 200 Wedge practices, where patients can find affordable, patient-centered care, are located in 44 states and listed online.

CCHF is a national patient-centered health freedom organization existing to protect health care choices, individualized patient care, and medical and genetic privacy rights. For more information about CCHF, visit, its Facebook page or its Twitter feed @CCHFreedom. Also view the media page for CCHF here. For more about The Wedge of Health Freedom, visit www.JointheWedge.comThe Wedge Facebook page or follow The Wedge on Twitter @wedgeoffreedom.